The Decision handed down yesterday has come about as part of the Review of Modern Awards.  As part of the Review process several areas of interest have been explored.

In the area of casual employment there has been much media coverage and speculation but it is important for all fuel industry operators to understand the current and coming requirements.

As part of the Review unions, individuals and employer organisations have petitioned the Commission to make (or not make) changes in the area of the operation casual employees across the fuel industry and across the whole employment market.  In general the union submissions centred around calls for all regular casuals to be automatically deemed to be permanent employees after a qualifying period of employment (most setting this at 12 months).  The arguments put forward largely assume that casual employees are casuals solely at the determination and desire of the employer.  This argument discounts or ignores the fact that in many cases casual employment is the preference of the employee based on financial, study, family and other commitments and concerns.

Had the Commission granted an automatic deeming of all casuals to be permanent / permanent part time, the result would have been drastic changes to wage structure and payroll systems across the employment market.  ‘In fuel retail particularly, where many small family operated site already struggle with payroll the management of the shift loadings that apply to permanent staff in a myriad of complex possibilities and combinations depending on the operation of the whole roster, such a unilateral change would likely have resulted widespread cost and confusion’ said Elisha Radwanowski, Executive Manager for Employment and Training for ACAPMA.

‘In the Decision handed down yesterday the Fair Work Commission has stopped short of acceding to these calls for automatic deeming of casuals as permanent staff.  Rather the Commission identified that there are legitimate situations where casual employment is the preference of the employee and the employer and to create a situation where employees were automatically converted from casual to permanent status, regardless of their personal circumstances and preferences, would be a perverse outcome’ continued Elisha.

The Commission has however, identified that there are a number of Awards that do not have any provision for casual conversion discussions to be facilitated between employees and employers, that there is not a prompt for both parties to review their choices and assess their appropriateness long term.  To address this the Commission has developed a model casual conversion clause that the decision has outlined will be placed in all modern Awards that do not currently have a casual conversion clause.  The model clause is open for discussion and comment until 2nd August 2017 after which time the Commission will finalise the clause and fold it into all modern Awards that currently do not have a casual conversion clause.

The characteristics of the model clause include a requirement for employers to provide casual employees with a copy of the casual conversion clause within 12 months of their start date and a requirement to consider and approve an election by a casual employee to convert to permanent status unless, such conversion would result in significant adjustment to hours currently worked in order to meet the permanent employment provisions of the Award, it is clear that the position will soon cease to exist, it is clear that the hours currently worked are likely to significantly change in the next 12 months, or any other reasonable grounds.

There is likely to be some finessing of the model clause in the coming weeks as part of the comment period until 2nd August 2017, however the Decision makes it clear that those Awards that do not currently have an established casual conversion clause and process will soon have them inserted.

The Decision has also highlighted that it is open to the review of current casual conversion clauses in line with the model clause.  Final Determinations on any changes to existing casual conversion clauses will likely be released soon after 2nd August 2017.

What is important for operators in the fuel wholesale and retail industry to understand is the current provisions in the Awards and the impact of the recent Decision on the future operation of these provisions.

Under the Road Transport and Distribution Award 2010, which applies to fuel wholesale transport workers, clause 12.6 outlines the casual conversion process, whereby a regularly engaged casual working regular systematic hours for a period of 12 months, is entitled to elect to convert to permanent.  There is a requirement within the clause that the business remind the employee, in writing, within four weeks of their right to elect to convert upon the right accruing (after 12 months).  If the employee elects to convert to permanent they must do so in writing within four weeks.  Once the business receives an election to convert to permanent it must be either accepted or refused but must not unreasonably be refused.  If the election is refused the refusal must specify reasons and be discussed with the employee.

Under the Vehicle Manufacturing, Repair, Service and Retail Award 2010, which applies to fuel retail workers, clause 13.3 outlines the casual conversion process, whereby a regularly engaged casual working regular systematic hours for a period of six months, is entitled to elect to convert to permanent.  There is a requirement within the clause that the business remind the employee, in writing, within four weeks of their right to elect to convert upon the right accruing (after six months).  If the employee elects to convert to permanent they must do so in writing within four weeks.  Once the business receives an election to convert to permanent it must be either accepted or refused but must not unreasonably be refused.  If the election is refused the refusal must specify reasons and be discussed with the employee.

Under the Clerks – Private Sector Award 2010, there is not an existing provision for casual conversion, as such the model clause will apply in its final form.

As ACAPMA has outlined here, here and here the operation of casual conversion is not new to the fuel wholesale and retail industry having been in operation for many years.  The Decision handed down yesterday has not drastically altered the operation of this element in the fuel wholesale and retail industry, rather it has highlighted that the Commission is keen to facilitate some streamlining of the notification process and to extend this requirement for dialogue on the employment relationship to other industries and Awards that do not currently have these requirements.

‘If the Commissions model clause is applied to our Awards, the requirement to notify employees of their right to elect to convert will be much more streamlined process for businesses, replacing the requirement to notify employees within a four week window around the time that the entitlement accrues, with the requirement to notify anytime within 12 months.  This would be a positive step’ said Elisha.

In a change made specifically to the Vehicle Manufacturing, Repair, Service and Retail Award 2010, which applies to retail fuel site workers, a new minimum engagement period for casuals will apply of 3 hours.  This is a completely new requirement.  ‘The area of the decision that may effect many fuel retail operators now is the new requirement to provide a minimum shift of 3 hours for casuals.  While most operators are running rosters that far exceed this and will not be too effected, some operators run with unique rosters based on specific time of day offerings’ continued Elisha.

ACAPMA advises all retail fuel site operators to review their rosters to ensure compliance with this new requirement.

Also included in the Decision handed down yesterday is a Determination that part time work will be allowed, with specific circumstances under the Road Transport (Long Distance) Operations Award 2010.  Whereas part time work had previously been precluded it will now be allowed in one, two or three fixed working days per week in a written part time agreement provided that a minimum of 8 hours or 500km (depending on the pay approach selected out of hours of km), is guaranteed per day/shift.  The Commission has further stipulated that an employee on a part time agreement under this Award may not work any other days or times than those specified under the agreement.  If the employer requests other days or times and the employee agrees that work is to be paid for at casual rates.  The final wording of this clause will be released after a comment period ending in mid August 2017.

‘The implications of the Decision handed down yesterday are going to be widely reported in the coming days.  We are urging all members to familiarise themselves with the current operations and requirements and to remember the final wording of any changes has not yet been released.  ACAPMA will keep members posted once the final Award changes are published’, closed Elisha.

A copy of the Fair Work Commission Decision of 5th July 2017 can be found here: https://www.fwc.gov.au/documents/decision_summaries/2017fwcfb3541-summary.pdf